Affordable housing bid for feasibility study hits a wall

WOODSTOCK – A fledgling affordable housing group that created some controversy because it is led by the McHenry County Board chairman’s son is examining its options after losing a two-year fight for access to federal money.

County staff informed the McHenry County Attainable Housing Corp. last month that it no longer will hold $13,000 it had asked for in 2011 for a feasibility study on the need for senior housing it wants to build in McHenry. The corporation has been unable to get certification as a community housing development organization, which is required to get Department of Housing and Urban Development funds disbursed by the County Board.

Without that designation, called a “chodo” in housing parlance, the corporation can’t have the money, county Planning and Development Director Dennis Sandquist said. The $13,000 likely will go out along with the next round of HUD funding, about $350,000, to qualified agencies.

“At this point, given they don’t have a sponsor, we told them we have to release those funds for other projects,” Sandquist said.

The corporation sought to build a 70-unit senior housing facility at Pearl Street and Route 31 in McHenry, across from St. Mary Catholic Church. But besides not having the appropriate status, the corporation’s contract to buy the land has expired, attorney Jeremy Shaw said.

Shaw said Monday that the group is pursuing options that include other locations in McHenry County, and possibly withdrawing entirely from asking for federal funds through the community housing development organization process.

“They’re still attempting to put together some form of affordable housing in McHenry County,” Shaw said.

The fact that the corporation Executive Director Kris Koehler is the son of Chairman Koehler, R-Crystal Lake, required a conflict-of-interest waiver from HUD, which made for a political hot potato for the County Board.

Its Planning and Development Committee forwarded it to the County Board only after county staff altered it so as not to give any appearance that board members were vouching for the project by forwarding the request to HUD. The full County Board voted May 15, on a 17-5 decision, to forward the waiver request to HUD. Chairman Koehler abstained throughout the process, never participating in discussions or voting on the issue.

But the request became irrelevant two days later when the corporation lost its “chodo” status because it lost its sponsor, Habitat for Humanity of McHenry County.

Habitat, currently the county’s only “chodo,” agreed to sponsor the corporation, which under the law would grant the status. But Habitat backed out with regret in a May 17 letter after county staff determined that the sponsorship created a conflict of interest, and therefore jeopardized $100,000 in funding for its program for critical home repairs for low-income residents.

The corporation tried to get certification through HUD rules granting “chodo” status to agencies that have spent at least a year engaging in “housing-related activities,” but Sandquist said the corporation did not meet the criteria.

Shaw was critical of opposition that his clients ran across on the County Board, and said it is factoring in whatever decisions its leadership ends up making. Kris Koehler founded the corporation with Charles “Chip” Eldredge III, son of Zoning Board of Appeals member and retired real estate consultant Charles Eldredge.

“I honestly think we’re going to come across more and more opposition, and more roadblocks, if they do get a sponsor,” Shaw said.